20 Nov Don’t let your holiday customers go cold after the season: Webinar Recap
Customers start churning the moment you acquire them, and after the holidays they churn even faster — 274% faster according to our latest research. Holding onto these customers you work so hard to acquire was the basis of our latest webinar, How to Keep Your Holiday Customers Long After the Season is Over. This webinar featured speakers Cara Klewin of ALOHA.com, along with Matthew Michelson and Jon Fox of Retention Science.
What is customer churn & why does it happen?
Churn is when a customer either stops purchasing or engaging with your brand. What makes customers churn? Our panelists spoke to five main reasons (and how to avoid these situations):
Poor customer service: Though the holidays are a busy time, it’s important to remember to take the time to make customer service a top priority. When customers feel a company really cares about their needs, they are more likely to return the favor.
Not enough value: Value is a subjective term for customers, so it’s important to find out what each customer considers valuable. For example, some customers may find free shipping valuable while others want unique product recommendations.
Poor quality communications: Give you communications a purpose, make them relevant to the individual and engage your customers in conversations to improve your overall quality.
No brand loyalty: Give new customers a reason to be loyal to your brand. Create a memorable experience: offer assistance when making first purchased or give incentives for the user to get to know your brand more by following you on social media.
Unmet expectations: Underpromise and overdeliver. Customers are delighted when you exceed their expectations, especially during the hectic holiday season. If you are unable to fulfill a promise, be transparent and remember: customer service can make all the difference.
How can you predict churn?
Churn is tricky to calculate and predict. A simple way to figure out your churn rate is to take the number of customers lost and divide it by the initial number of customers. This churn rate can then be used to calculate things like the number of customers lost, value of recurring business, and the percentage of recurring revenue lost.
However, data science provides a much more sophisticated way to look at and predict customer churn. At Retention Science, we assign a churn score to each customer that tells us their probability of churning. We then use the score to tell us if each customer is Ready to Buy, At Risk, or Churned and not likely to purchase again. We update 100 million users per day to determine where they fall on the churn spectrum.
There are several data science models used to predict churn. One in particular, the Markov Churn Model predicts the chances of a customer making their next purchase, given the number of purchases they’ve made previously and how recently they made their last purchase.
How can you prevent churn after the holidays?
Customers churn is just a part of doing business — there is no way to prevent every customers from churning; however, there are some things you can do to be proactive about customer churn:
Know who your customer is and if they change throughout the year. For example, jewelry companies may target women most of the year, but need to change their messaging around Christmas to target men.
Provide a smooth customer journey from start to finish. Test each stage of the purchasing process yourself to make sure it’s intuitive and easy to follow.
Reward your advocates as they are the most valuable customers you’ll have. Advocates promote your brand to their friends, family, and networks – reward them for providing reviews and getting their friends to become customers.
Time is of the essence when it comes to recapturing customers. The window to recapture interest is smaller than ever, make sure you have a reaction strategy in place to address customer actions.